Can You Import or Export Cannabis Products Between North American and Europe? Here’s What You Need to Know

By: Hala Laurette ElKhoury

It is no secret that cannabis use has been heavily criminalized globally throughout the 20th century.

In recent years, strides have been made to remove the stigma from this industry through a wave of acceptance and legalization of cannabis over various degrees.

These movements have led to the development of multi-lateral trade laws and regulations in efforts to create a solid legal landscape for the industry; and since this growth has started, a lot of users and entrepreneurs have become enthusiastic about accessing a wider range of products.

But the lack of clarity in trade regulations remains a handicap in the industry.

Although legal cannabis markets are growing and expanding, most of the cannabis traded around the world is still in the black market.

According to The Global Cannabis Report released by Prohibition Partners, the global legal cannabis market is estimated to reach $103.9 billion by 2024.

The report forecasts that this growth will mostly be driven by the international medical market for cannabis (which has the potential to reach $62.7 billion by 2024).

Regulations for importing and exporting cannabis legally

As of present, the three largest and most mature legal cannabis markets around the world are the US, Canada and Germany.

North America currently leads in product development, but the EU is predicted to surpass it within the next 5 years.

“The E.U. is moving more quickly than North America on the research front in many markets, compared to the U.S. where the federal prohibition creates barriers to research and limits the availability of plant material,” said Jordan Lewis, founder, chairman and CEO of vertically integrated, Uruguay-based Fotmer Life Sciences.

This year Europe launched its first medical cannabis Exchange Traded Fund in efforts to provide exposure to the rapidly expanding medical cannabis industry which has created interest in the European market on a global scale.

The continent has a population of over 740 million (over double that of the US and Canada combined) and has invested over €500 million in European cannabis businesses and research.

The Brightfield Group, a leading consumer insights and market intelligence firm for the Cannabis sector, predicts a 400% increase in the European CBD market over the next 3 years.

With this potential, numerous American/Canadian cannabis businesses have shown great interest in European investments, mainly through mergers and acquisitions due to the difficulties in international trade.

The North American and European markets can grow a mutually beneficial relationship under the correct legal landscapes.

These international investments prove that cannabis is making its way from the sidelines into the spotlight.

Right now, the rules and regulations are restrictive and do not really distinguish between the legal and illegal markets.

A closer look at each region’s import/export laws shows how ambiguous the trade process can be.

Importing and Exporting Cannabis – The United States of America:

The misalignment of state and federal laws is preventing the US to take a major role in global cannabis trade.

However, there are a number of well-funded and quite large US enterprises, with a large number of them looking to expand into the European market.

Import Laws: The American legal system states that if a product being imported into the country complies with US law, then, legally, it cannot be prohibited from entering the United States.

However, with the discrepancy in federal and state cannabis laws, the risks are still very real.

Export Laws: Now, exporting cannabis products from the US can be a more tedious process. It is a process that has to undergo many inspections and to pass many legal steps.

Briefly: the first step in determining whether a specific export is admissible under US law is “determining whether the product is described in an export control classification number (“ECCN”) set out in the Commerce Control List (“CCL”)”.

As a general rule you don’t need specific licenses to be able to import/export these products; unless you are exporting to sanctioned areas such as Cuba, Iran, North Korea or Syria.

Importing and Exporting Cannabis Canada:

The Canadian market has large listed companies that intend to acquire or invest in European operations. Some Canadian CBD firms are even publicly traded in the UK.

The maturity of the Canadian market has led to the Canadian law being the most clear when it comes to the cannabis sector.

According to the Canadian Cannabis Regulations, licensing is required to import/export cannabis products, and licenses are only approved for for medical/scientific purposes.

For every shipment into/out of the Canadian borders, an individual permit is necessary, and that permit is then assessed by the Canadian border control and Cannabis Act enforcers on a case-by-case basis.

Importing and Exporting Cannabis-The European Union:

Unlike the previous two regions, countries within the EU & the UK operate differently: the process for importing and exporting cannabis products is more of a hybrid between the former two.

Companies or individuals looking to import/ export cannabis products must obtain a specific license approved by the respective governing bodies, allowing them to import and export.

This process is more convenient and less tedious than in North America, because the licenses are continuous (one-time licenses subject to renewal).

Once the government approves your license, it becomes easier than obtaining one for each shipment or worrying that individual shipments don’t make it.

The main prerequisite to be granted this permit is that the cannabis being imported is grown in the country of origin for medical purposes.

In addition, several legal questions must be clarified before the application is approved, such as: the varieties of flowers/products, the country of origin, the necessary permits/licenses.

Usually, this application procedure takes between 6 and 12 weeks to be processed and reviewed.

Within the EU zone itself, importing and exporting cannabis is fairly straightforward; but, intercontinental business remains concentrated on mergers/acquisitions or cross-border operations (like passporting of licenses or selling franchises).

The upshot, in other words, is that while cannabis still may be “stigmatized” or “illegal” in many parts of the world, specialized global trade agreements between the US, Europe and Canada have been driving the development of the cannabis industry globally.

There is an increased push for a public dialogue in relation to medicinal and recreational cannabis in the EU and in North America backed by many researchers and influencers in the field.

Facilitating the trade between these regions could have countless positive repercussions on the cannabis industry, some of which are: international reach, transfer of knowledge, readily available skills and experiences, international access to all types of seeds, cultivation, manufacturing, marketing, sales, licensing, funding, and research and development.

However, the globalization of the cannabis industry doesn’t come without challenges. Legal ambiguity as we saw previously.

dealing with an unclear, ambiguous and non-uniform legal environment. Most countries recognize potential but struggle with deep rooted misperceptions and fractured public opinions, lobby groups are weak and policy makers meek, typically hedging their bets, allowing hemp cultivation and processing for export, which keeps them in the game while kicking the important issue down the line.

With the mass legalization of cannabis, we could witness an immense growth in the market which would lead to a drop in prices, regeneration of the entire industry, great technological leaps in the industry, transparency and traceability, and domesticated supply chains (due to the awareness and legalization).

Hala Laurette ElKhoury is a writer with experience in cannabis business and industry.

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